Govt offers tax relief to SSIs

NEW DELHI: The government on Wednesday announced tax relief to some items of small-scale sector including bicycle parts, ball and roller industries, and said the proposed value-added tax system from April 2003 would further benefit the sector.
"We will take an encouraging and sympatheic view about the problems of SSIs. We have set up task force on both Direct and Indirect Taxes which will look into the problems. The recommendations will be of great help to the sector," Finance Minister Jaswant Singh said at the Annual SSI Convention here.
He said most of the SSIs would also benefit from the VAT, scheduled to be implemented from April 2003. "About 90 per cent of the work has been completed. As soon as VAT is implemented, many SSIs will also be benefitted," Singh said.
The minister also announced that the government would restore the investment limit on ball and roller industries to Rs 1.0 crore from Rs 25 lakh, as demanded by the sector. He also said the ministry was looking at extending excise exemption to electronic toy industry as well.
Hand-processing sectors will also get exemptions as enjoyed before the budget announcement for 2002-03, he said.
The government reduced excise exemption on hand-processing to only three processes mainly scouring, hydro-extraction and calendering in the last budget.
Singh said the relaxation in payment of duties by the bicycle industry would be made effective immediately.
The Department of Company Affairs was also examining the feasibility of a Limited Partnership Act, which intends to limit the liability of a partner in an SSI company to the equity only.